Soviet Union Of America (1)

Prologue

I believe the history of the U.S. in the 20th century and beyond is full of examples how similar the U.S. economic policy came to mimic the Soviet Union system. Perhaps this will become a series of blog posts as time goes by. :-)

Trigger

Just read “Net Neutrality: Good for Google, Not Consumers/Businesses used to accept being charged to use technology. Now they fight to shift the burden.

” by G. KEITH Cambron published May 1, 2014.

Here is the salient quote from this article (Emphasis added):

“When I began my career as an engineer at Bell Telephone Labs in the 1970s, one of my jobs was to figure out how much offering new services would cost. ATT our parent company, would use the information to calculate proposed tariffs for state and federal regulators. These tariffs governed what consumers and businesses paid for communication services.

The regulators had a guiding principle: Businesses should subsidize consumers to promote the public good and ensure universal service. It was common to charge businesses twice as much as consumers for basic phone service, and for additional features such as call waiting. Businesses accepted the policy because they recognized the value of services that helped customers reach them.

Mr. Cambron is the former president and CEO of AT&T Labs and author of "Global Networks: Engineering, Operation and Design" ( Wiley, 2012).”

Government Price Controls

Like in the Soviet Union government price controls have been and still are present in the U.S. or if they are not present any industry or business has to fear that the federal government or a state or municipal government could step in any time.

Mr. Cambron claims that “businesses accepted the policy because they recognized the value of service ...”. I would claim Mr. Cambron is quite wrong. If big businesses like AT&T accepted it then because it preserved their monopoly business from competition with the help of big government.

We the people (consumers and entrepreneurs) lost here in more than one way! For decades, they had to pay too much for service and innovation was stymied thanks to this collusion between big business and big government.

The Blue Box - One Of Steve Jobs First Products

The Two Steves

Steve Wozniak and Steve Jobs supposedly built and sold such a product in the early 1970s (See here & here). “Going door to door in Berkeley dorms, they managed to sell several dozen at $170 each. The "two Steves" savored this mix of clever engineering and entrepreneurial hustle: As Mr. Lapsley quotes Jobs saying: "If we hadn't made blue boxes, there would have been no Apple."”

The Blue Box

The Blue Box was a device used by phreaks (predecessors of hackers) and criminals to circumvent Ma Bell and wire tapping.

Wikipedia: “A blue box is an unauthorized electronic device that generates the same tones employed by a telephone operator's dialing console to switch long-distance calls. The most typical use of a blue box was to place free telephone calls. … Development and use of the blue box was largely enabled by Bell Telephone's policy of publishing all technical documentation regarding its equipment.”

A Blind Kid Whistling At The Perfect Pitch

The critical 2400 Hz telephone system control tone was discovered in approximately 1957, by Josef Carl Engressia, a blind seven-year old boy who became known as Joybubbles. Engressia was skilled with perfect pitch, and discovered that whistling the fourth E above middle C (a frequency of 2600 Hz) would stop a dialed phone recording. Unaware of what he had done, Engressia called the phone company and asked why the recordings had stopped.

As a five-year old, Engressia had already discovered he could dial phone numbers by clicking the hang-up switch (“tapping”).

In his book iWoz: From Computer Geek to Cult Icon: How I Invented the Personal Computer, Co-Founded Apple, and Had Fun Doing It, Apple co-founder Steve Wozniak mentions Joybubbles as an early inspiration during his college years.

The Moral Of The Story

Big Government created a monopoly called AT&T in 1913, which lasted until 1984 or more than 70 years effectively preventing progress in telecommunications and computers. Thus, the people had to put up with inferior technology and higher pricing for a very long time thanks to Big Government. It is an irony of history that the US federal government created this monopoly even before the Soviet Union came into existence.